Massachusetts has a compliance structure that differs from most states in one important way: its corporate excise tax has both an income component and a property (net worth) component, and businesses owe the greater of the two. This means even a company with no Massachusetts income may owe meaningful state tax based on its Massachusetts property.
Annual Report Filing
Every Massachusetts domestic corporation must file an Annual Report with the Secretary of the Commonwealth by the 15th day of the third month after the close of the fiscal year — March 15 for calendar-year filers — under M.G.L. c. 156D, § 16.22. The filing fee is $125. LLCs file an Annual Report by the 15th day of the fourth month after close of fiscal year (April 15 for calendar-year filers) under M.G.L. c. 156C, § 12. The LLC annual report fee is $500.
Massachusetts LLCs pay $500 annually regardless of size — this is among the higher LLC annual report fees in the country and is a frequently cited friction point for early-stage companies. Late filing results in dissolution proceedings after 60 days.
Corporate Excise Tax: Income and Property Components
Under M.G.L. c. 63, § 32, domestic corporations owe the corporate excise tax, which is the sum of:
- Income component: 8% of Massachusetts net income (non-financial institutions); or
- Property component: $2.60 per $1,000 of taxable Massachusetts tangible property (or net worth if no tangible property)
The minimum corporate excise tax is $456. The return (Form 355) is due on the 15th day of the third month after fiscal year end (March 15 for calendar-year filers). Massachusetts has enacted a "millionaires tax" — an additional 4% surtax on personal income (and certain pass-through income) above $1,000,000 under Article 44 of the Massachusetts Constitution, effective 2023.
Massachusetts Sales Tax
Massachusetts imposes a 6.25% sales tax on tangible personal property and certain services under M.G.L. c. 64H. Economic nexus applies to remote sellers with more than $100,000 in Massachusetts sales. The Massachusetts Department of Revenue requires monthly, quarterly, or annual filing depending on liability level.
Massachusetts Employer Obligations
Massachusetts employers must withhold state income tax (ranging from 5% to 9% depending on income level) and register with the Massachusetts Department of Revenue. Massachusetts has a mandatory Paid Family and Medical Leave program (M.G.L. c. 175M) requiring quarterly premium contributions from employers. The 2025 PFML contribution rate is 0.88% of wages.
Key Deadlines
- Corporation Annual Report: March 15 (calendar year). Fee: $125.
- LLC Annual Report: April 15 (calendar year). Fee: $500.
- Corporate Excise Tax (Form 355): March 15 (calendar year). Minimum: $456.
- PFML Premium: Quarterly, by end of month following quarter end.
How Compliance Singularity Handles Massachusetts
Compliance Singularity tracks both annual report deadlines (different for corporations and LLCs) and files through the Secretary of the Commonwealth's online system. Corporate excise tax obligations are calendared and computed using data from your accounting integration. The $500 LLC annual report fee is queued for payment automatically — no manual check-writing required.